4 ms·

What concrete data do you have to suggest that luxury homes aren't being occupied at significantly higher rates than general housing stock?

onion2k 5y ago
https://www.actiononemptyhomes.org/pretty-vacant https://www.actiononemptyhomes.org/pretty-vacant "Wealth investment leaves an estimated 125,000 homes in London without anyone living in them." There are 268,385 empty homes in England according to the government (people get a tax break in most parts of England if they own a property that is unoccupied and unfurnished so its quite easy to track empty homes), and half of them are luxury houses in London. I'm not saying that's definitely the case everywhere, but I am saying it's worth considering.
- maddyboo 5y ago
  What is the rationale for giving such a tax break? That seems ridiculous.
  - onion2k 5y ago
    The current UK government is full of people who believe rich people keeping their money is how you stimulate the economy in to growth. It's not a completely unreasonable position according to economic theory but there are plenty of reasons to disagree with it.
    - imtringued 5y ago
      If your economy cannot produce all the products consumers consume then you need to encourage saving. If the economy cannot consume all the products the suppliers produce you need to encourage consumption. If you perfectly hit the balance (unlikely but in theory possible) then you need to do... nothing, neither savings nor consumption increases. It depends on what your economy needs.
- tylerhou 5y ago
  The actual report says that there are 125,000 homes in London without permanent residents. Those homes aren't unoccupied; they're often used for AirBnB or temporary rentals. That's not a vacancy. In reality, only a fifth of those homes are empty most of the time. Also, the report doesn't tell us how many non-vacant homes there are in their survey area, so we have to guess. London reportedly has 3.59 million dwellings, so 25,000 vacant homes would only represent 0.7% of homes being vacant. Even if you use the higher 125,000 number, that's still only 3.5% of all homes. That's a fairly low vacancy rate, and about right for a city. Even after the pandemic, housing officials report a 3.4% vacancy rate, which is the highest in eight years. https://lfpress.com/news/local-news/london-apartment-vacancy-rate-hits-eight-year-high-of-3-4-per-cent https://lfpress.com/news/local-news/london-apartment-vacancy.... Before that, it was only at 1.8%. That's extremely low. You can tax vacant homes, but in general, those taxes have a very small effect on housing prices. It's far, far more effective to allow people to build more housing, including luxury housing.
sp332 5y ago
Vancouver https://bc.ctvnews.ca/10-800-housing-units-sit-empty-in-vancouver-most-are-apartments-1.2808161 https://bc.ctvnews.ca/10-800-housing-units-sit-empty-in-vanc... Manhattan https://www.theatlantic.com/ideas/archive/2020/01/american-housing-has-gone-insane/605005/ https://www.theatlantic.com/ideas/archive/2020/01/american-h... Seattle https://www.seattleweekly.com/news/luxury-apartments-whos-buying-king-county/ https://www.seattleweekly.com/news/luxury-apartments-whos-bu... Melbourne https://www.theage.com.au/national/victoria/ghost-tower-warning-for-docklands-after-data-reveals-high-melbourne-home-vacancies-20141111-11kkxz.html https://www.theage.com.au/national/victoria/ghost-tower-warn... Boston https://bostonagentmagazine.com/2018/09/11/study-bostons-new-luxury-towers-largely-sit-empty/ https://bostonagentmagazine.com/2018/09/11/study-bostons-new...
- epistasis 5y ago
  That seems like solid evidence that vacancy is not the problem in the least...
- tylerhou 5y ago
  None of the articles support a narrative that there is an epidemic of vacancies among high-end housing. Vancouver: The article claims that there is ~5% vacancy rate. This is actually below the normal rate for vacancies in the US. Condos have a higher vacancy rate, but the article offers a reasonable explanation. Manhattan: Ultra-luxury home vacancies aren't the same as luxury apartment buildings. Most people are not buying $5-$10 million condos. And even if the buildings are unsold, they aren't necessarily unoccupied. Seattle: Again focuses on "foreign investors" and unsold apartments. No concrete data on how many those apartments are actually empty. Melbourne: > Prosper Australia project director Karl Fitzgerald said, based on the water data, Melbourne's actual vacancy rate was closer to 7 per cent. 7% is on the high-end of vacancy rates, but if you reduced that down to 5% then the effect on prices would still be low. Boston: No data on vacancy rates. Again, sale != occupancy. There are plenty of property management companies that build out luxury apartment buildings and directly rent to people. The real issue is lack of housing, which can be fixed by letting developers build more housing, including high-end housing.
  - 5y ago

onion2k 5y ago

https://www.actiononemptyhomes.org/pretty-vacant https://www.actiononemptyhomes.org/pretty-vacant "Wealth investment leaves an estimated 125,000 homes in London without anyone living in them." There are 268,385 empty homes in England according to the government (people get a tax break in most parts of England if they own a property that is unoccupied and unfurnished so its quite easy to track empty homes), and half of them are luxury houses in London. I'm not saying that's definitely the case everywhere, but I am saying it's worth considering.

maddyboo 5y ago
What is the rationale for giving such a tax break? That seems ridiculous.
- onion2k 5y ago
  The current UK government is full of people who believe rich people keeping their money is how you stimulate the economy in to growth. It's not a completely unreasonable position according to economic theory but there are plenty of reasons to disagree with it.
  - imtringued 5y ago
    If your economy cannot produce all the products consumers consume then you need to encourage saving. If the economy cannot consume all the products the suppliers produce you need to encourage consumption. If you perfectly hit the balance (unlikely but in theory possible) then you need to do... nothing, neither savings nor consumption increases. It depends on what your economy needs.
tylerhou 5y ago
The actual report says that there are 125,000 homes in London without permanent residents. Those homes aren't unoccupied; they're often used for AirBnB or temporary rentals. That's not a vacancy. In reality, only a fifth of those homes are empty most of the time. Also, the report doesn't tell us how many non-vacant homes there are in their survey area, so we have to guess. London reportedly has 3.59 million dwellings, so 25,000 vacant homes would only represent 0.7% of homes being vacant. Even if you use the higher 125,000 number, that's still only 3.5% of all homes. That's a fairly low vacancy rate, and about right for a city. Even after the pandemic, housing officials report a 3.4% vacancy rate, which is the highest in eight years. https://lfpress.com/news/local-news/london-apartment-vacancy-rate-hits-eight-year-high-of-3-4-per-cent https://lfpress.com/news/local-news/london-apartment-vacancy.... Before that, it was only at 1.8%. That's extremely low. You can tax vacant homes, but in general, those taxes have a very small effect on housing prices. It's far, far more effective to allow people to build more housing, including luxury housing.

sp332 5y ago

Vancouver https://bc.ctvnews.ca/10-800-housing-units-sit-empty-in-vancouver-most-are-apartments-1.2808161 https://bc.ctvnews.ca/10-800-housing-units-sit-empty-in-vanc... Manhattan https://www.theatlantic.com/ideas/archive/2020/01/american-housing-has-gone-insane/605005/ https://www.theatlantic.com/ideas/archive/2020/01/american-h... Seattle https://www.seattleweekly.com/news/luxury-apartments-whos-buying-king-county/ https://www.seattleweekly.com/news/luxury-apartments-whos-bu... Melbourne https://www.theage.com.au/national/victoria/ghost-tower-warning-for-docklands-after-data-reveals-high-melbourne-home-vacancies-20141111-11kkxz.html https://www.theage.com.au/national/victoria/ghost-tower-warn... Boston https://bostonagentmagazine.com/2018/09/11/study-bostons-new-luxury-towers-largely-sit-empty/ https://bostonagentmagazine.com/2018/09/11/study-bostons-new...

epistasis 5y ago
That seems like solid evidence that vacancy is not the problem in the least...
tylerhou 5y ago
None of the articles support a narrative that there is an epidemic of vacancies among high-end housing. Vancouver: The article claims that there is ~5% vacancy rate. This is actually below the normal rate for vacancies in the US. Condos have a higher vacancy rate, but the article offers a reasonable explanation. Manhattan: Ultra-luxury home vacancies aren't the same as luxury apartment buildings. Most people are not buying $5-$10 million condos. And even if the buildings are unsold, they aren't necessarily unoccupied. Seattle: Again focuses on "foreign investors" and unsold apartments. No concrete data on how many those apartments are actually empty. Melbourne: > Prosper Australia project director Karl Fitzgerald said, based on the water data, Melbourne's actual vacancy rate was closer to 7 per cent. 7% is on the high-end of vacancy rates, but if you reduced that down to 5% then the effect on prices would still be low. Boston: No data on vacancy rates. Again, sale != occupancy. There are plenty of property management companies that build out luxury apartment buildings and directly rent to people. The real issue is lack of housing, which can be fixed by letting developers build more housing, including high-end housing.
- 5y ago